New Zealand's KlickEx group, a company that provides money transfer services for the unbanked and for developing economies, has teamed up with IBM and USA based blockchain network, Stellar, to offer a blockchain based service to financial institutions that the three claim will accelerate and reduce the cost of global payments for financial institutions and for their business and consumer customers. They have partnered with the payment company KlickEx and Blockchain startup Stellar for developing this solution which can reduce the settlement time and transaction cost for global payments. Services like TransferWire, American Express or Western Union Money Transfer are rather good for savvy customers, but not suitable for small businesses which can not afford the huge transaction costs. Compared to banking system, many new solutions are coming up that offer faster worldwide transactions. If the transactions involves different currencies, then it will require multiple intermediaries which increases the processing time.
The solution uses IBM Blockchain technology to provide both clearing and settlement of trades on a single network in real time.
"The blockchain would be used to record the terms of the contract, manage trade documentation, allow the farmer to put up collateral, obtain letters of credit, and finalise transaction terms with immediate payment, conducting global trade with transparency and relative ease", IBM said in its latest press release.
The new banking solution is also expected to process up to 60% of all cross-border payments in the South Pacific's retail foreign exchange corridors including Australia, New Zealand, Fiji, Samoa and Tonga by early next year. His team also leads global partnerships, represents IBM in industry consortiums, engages clients in solution design and development, and informs IBM's strategic investment priorities within the Blockchain and cryptocurrency industries. As Dream Payments provides a solution that allows businesses to sell from anywhere and accept payments from any tablet or mobile device, the goal is to help SMBs and financial institutions deliver mobile solutions faster.
BlockChain that depends on a divergent network of computers for creating an indelible, transactions of tamper-proof record, is highly associated with the Bitcoin digital currency.
While majority of banking institutions don't believe in cryptocurrencies, they can still use blockchain technology for improving speed and security for cross-border transactions. Big Blue has already been forging blockchain collaborations with several exchanges like the Memphis-based cotton exchange and London Stock Exchange.